The paper "Intrinsic Rewards & Employee Motivation" is a great example of management coursework. The assertion that “ In today’ s workplace, intrinsic rewards are more important than extrinsic rewards for employee motivation, ” implies that it is the internal rewards that an employee can only define for himself and are described somewhat nebulously with terms like ‘ satisfaction, ’ ‘ sense of accomplishment, ’ or ‘ fulfillment’ that is more important than external rewards such as performance-based pay, which can be defined the same way for everyone. Taken at face value, it seems to make sense; an employee will not perform to his full potential if he does not have a good feeling about doing so.
Most contemporary literature assumes that this ‘ good feeling’ is more substantial if it is the result of some intrinsic rewards because they reward a person’ s higher-order needs such as self-actualization, self-esteem, or the respect from peers. (Kominis & Emmanuel, 2005, p. 57) Even though it is recognized that each employee requires a unique combination of both intrinsic and extrinsic rewards for proper motivation (Beswick, 2007), the perspective presented to managers in recent commentaries is that the intrinsic rewards should be given far more weight.
The idea is that extrinsic rewards, being the same for everyone and differing only in terms of size, can be offered by any employer. In order to get the most from its employees, or even to simply retain its workers, an organization must offer some other “ added value” to the job, and consider rewards from an almost ‘ spiritual’ perspective. (SHRM India, 2010; Whittington & Galpin, 2010, pp. 14-16) This obvious question raised by this perspective is whether or not it is actually valid.
Do employees, in fact, respond better to or prefer intrinsic rewards than extrinsic ones? This paper will briefly review some of the studies that have been done that attempt to answer that question, which is perhaps more complicated than it first appears. What Employees Say About Motivation The most obvious way to determine what factors motivate employees to work is to simply ask them. Repeated surveys over a period of about 40 years showed that employee motivations sometimes do change over time. In a survey in 1946, for example, industrial workers rated “ appreciation” as the most important of a number of suggested motivating factors and rated “ discipline” the least important.
By the 1980s, however, “ interesting work” became more important, and by the early 1990s, “ good wages” had become the priority. (Wiley, 1997, p. 267) Good wages are most definitely an example of extrinsic motivation, and appreciation maybe if the employee is working with an expectation of receiving acknowledgment in return. Furthermore, in the 1992 survey some other clearly intrinsic motivations ranked rather low in employees’ opinions: the “ feeling of being in on things” was ranked 9th out of 10 factors, “ personal or company loyalty to employees” was only ranked 6th, and “ interesting work” was ranked 5th.
To be fair, “ appreciation” did rank as the second-most important motivating factor, but since it was separate from “ personal or company loyalty to employees” seems to have been considered more as a quid pro quo, extrinsic factor. Other extrinsic motivations such as “ job security” and “ promotion and growth within the organization” ranked third and fourth, respectively. (Wiley, 1997, p. 268)
Beswick, D. (2007). ‘Management implications of the interaction between intrinsic motivation and extrinsic rewards.’ University of Melbourne [Internet], updated 15 February 2007. Available from: http://www.beswick.info/psychres/ management.htm.
Flynn, S. (2011). ‘Can you directly motivate employees? Exploding the myth.’ Development and Learning in Organizations, Vol. 25, No. 1 (forthcoming), pp. 11-15. DOI: 10.1108/14777281111096771.
Grabmeier, J. (2002) ‘Intrinsic Motivation Doesn’t Exist, Researcher Says.’ Ohio State Research News [Internet], Ohio State University. Available from: http://researchnews.osu.edu/archive/inmotiv.htm.
Kominis, G., and Emmanuel, C.R. (2005). ‘Exploring the Reward Preferences of Middle-Level Managers.’ Qualitative Research in Accounting & Management, Vol. 2, No. 1, pp. 54-76. DOI: 10.1108/11766090510635389.
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Reiss, S. (2001). Who Am I? The 16 Basic Desires That Motivate Our Actions and Define Our Personalities. New York: Tarcher/Putnam.
Reychav, I., and Sharkie, R. (2010). ‘Trust: an antecedent to employee extra-role behaviour.’ Journal of Intellectual Capital, Vol. 11, No. 2, pp. 227-247. DOI: 10.1108/14691931011039697.
SHRM India. (2010). ‘Motivation in Today’s Workplace: The Link to Performance.’ Society for Human Resource Management India [Internet], 7 January 2010. Available from: http://www.shrmindia.org/motivation-today%E2%80%99s-workplace-link-performance.
Whittington, J.L, and Galpin, T.J. (2010). ‘The engagement factor: building a high-commitment organization in a low-commitment world.’ Journal of Business Strategy, Vol. 31, No. 5, pp. 14-24. DOI: 10.1108/02756661011076282.
Wiley, C. (1997). ‘What motivates employees according to over 40 years of motivation surveys.’ International Journal of Manpower, Vol. 18, No. 3, pp. 263-280. DOI: 10.1108/01437729710169373.